You didn't answer my question but instead threw up the "Bush wasn't criticized like this" nonsense.

Is not counting people without a job but and looking for a job in the past 4 weeks a good determination of "unemployment" in the context of a barometer for the health of an economy? Would you consider someone that's been without a job for 4 weeks and not having looked for a job in that time span unemployed?

Actually, I did. That's the first thing I did before explaining that it wasn't relevant to the point of my post.

Quote
from Dr. J
:

I don't think U6 is an excellent measure, as it's essentially everyone that wants FT employment but doesn't have it, but it's far better than some arbitrary 4 week cutoff.

And the absolute temperature scale might be "better" for some things, but when you're trying to tell someone that it's ten degrees warmer than yesterday they will appreciate that you use the same scale that they are used to using and that the number movement you report communicates useful information in a meaningful way, that is to say, telling them whether it's warmer or colder compared to yesterday and the day before.

U3 and U6 are both arbitrary, but I don't find one application per month an unreasonable standard of evidence that a person "wants" a job. But again, that isn't really the point. The point is that neither measure is objectively right or wrong. They are simply different measures. And if we're going to go around comparing one number to another, a consistent scale is useful.

U6 isn't suddenly "real unemployment" now that Obama is in office. It's one of several measures, which happened to exist well before this administration. It's no more "real" now than it has been for the last 20 years, and U3 is no less real.

In many ways I do agree that this is a reasonable standard, but that's hardly the point of my post and a different conversation altogether.

Again, the point is that a consistent measure allows for comparison.

Why is U3 relevant:

U3 is the international measure. We can use it to say "Our unemployment has risen .02 to X compared to Greece, which has risen .7 to Y" without the need for a lengthy discussion of the intricacies of how each country calculates the figure. (It's not that the information can't be valuable, it's just rarely used that way.)

Clinton, Clinton, Bush, Bush, Obama terms were all reported with the U3 metric. We can compare one to another without the need for a lengthy discussion of the intricacies of how each country calculates the figure.

The promises and projections of the current administration are made using the same measure that is consistent with international measure and with the preceding administrations.

Why a sudden interest in and support for alternative measures:

They are larger numbers and larger unemployment numbers fit a particular political narrative.

There isn't a sudden groundswell of popular support for U4 and U6 because the people of America suddenly, en masse, learned something about economics. It's not because the American people are in the streets screaming "We've used this particular measure of unemployment for the last 20 years and I'm not going to take it anymore!" It's not a grassroots revolution in statistical technique.

No, conservatives are "suddenly aware" of different measures of unemployment because their reality-remodeling media echo chamber have created a narrative in which the Obama administration is cooking the unemployment figures to hide the "real" unemployment rate. "Not only are things much worse than you thought the "mainstream media" is colluding with Obama to cover it up. We're here to help you discover the truth (when it's convenient)."

A Google search for "u6 unemployment" from ALL RECORDED HISTORY to 2009 yields 373 hits[google.com].

Give me a break. It's like a farking monkey circus. If these same vocal advocates had been bursting with passion for one method of measure 6 years ago, we might think that they were, at least, honest in their advocacy.

Unfortunately, it's the same crowd that suddenly discovered a "much better way" of calculating the deficit when the Clinton administration delivered a surplus. These passionate truth seekers were mute regarding the ultimate truth of this methodology that would have made the Reagan and Bush 1 deficits appear larger, but if there was a chance to say that Clinton didn't deliver a surplus, suddenly every yahoo with Fox news and an internet connection knows that it's not "really" a surplus. Gee, imagine that. If we change the way we measure stuff we can make more favorable apples-to-oranges comparisons. I swear to god, I should market a special Penis ruler that uses the far more accurate P6 inches. I could make a mint posting my ads on any site that Goldline is targeting.

FWIW, I've been saying unemployment has been understated since before I joined this forum.

Labor market deterioration
I’ve argued on many occasions that the official unemployment rate has been a poor guide to the reality of the labor market in recent years. One alternative is “U6″, which the BLS lists under “alternative measures of labor underutilization.” It’s defined as

Total unemployed, plus all marginally attached workers plus total employed part time for economic reasons, as a percent of all civilian labor force plus all marginally attached workers

The broadest unemployment measure
This measure shows what most people sense: the labor market has gotten a lot worse over the past year, not just in the last few months.

Last edited by Xygonn; 11-02-2012 at 01:58 PM..

If I appear to be ignoring your posts, it's probably because you are on my ignore list.

FWIW, I've been saying unemployment has been understated since before I joined this forum.

Sure, and it has been understated- or perhaps "stated differently"- for a long time now. Nuance like underemployment does allow a better understanding of what is actually going on, and the people who know what to do with the additional data can already use that data. I'm just saying that the value of the unemployment statistic as discussed in political context and as related to the general public is entirely comparative. We want to measure performance against other countries and against our past. People want to know if it's hotter or colder. To do that without a lengthy discussion of methodology each time, it make sense to use the same scale that we've been using and the same measure that other countries use. Apples to apples. If that scale becomes U6, that's fine too.

I've just hit my tipping point for the "Obama and the media are hiding real unemployment" meme that is suddenly popular and important. Next we'll have Obama and the green-media colluding on the Fahrenheit conspiracy to make summer temperatures sound warmer.

BTW, I usually assume that you do your own thinking. You were not lumped in. :-)

Sure, and it has been understated- or perhaps "stated differently"- for a long time now. Nuance like underemployment does allow a better understanding of what is actually going on, and the people who know what to do with the additional data can already use that data. I'm just saying that the value of the unemployment statistic as discussed in political context and as related to the general public is entirely comparative. We want to measure performance against other countries and against our past. People want to know if it's hotter or colder. To do that without a lengthy discussion of methodology each time, it make sense to use the same scale that we've been using and the same measure that other countries use. Apples to apples. If that scale becomes U6, that's fine too.

I've just hit my tipping point for the "Obama and the media are hiding real unemployment" meme that is suddenly popular and important. Next we'll have Obama and the green-media colluding on the Fahrenheit conspiracy to make summer temperatures sound warmer.

BTW, I usually assume that you do your own thinking. You were not lumped in. :-)

It does work back to 1994, but it is apples to oranges before that. So comparing unemployment in the Reagan and Carter years to today is not a good comparison. Likewise, it is apples to lemons before Johnson. So comparisons between now and the Great Depression aren't particularly valid. Also, comparisons to the 70s and the Depression aren't particularly valid.

It does work back to 1994, but it is apples to oranges before that. So comparing unemployment in the Reagan and Carter years to today is not a good comparison. Likewise, it is apples to lemons before Johnson. So comparisons between now and the Great Depression aren't particularly valid. Also, comparisons to the 70s and the Depression aren't particularly valid.

It's evolved more than twice, but that's basically true. Johnson to H.W. Bush are close enough to still be quite useful, but beyond that it starts to get fuzzier. If we'd had U3 and U6 measures during the depression era the number would likely be dramatically higher than history records.

God forbid if Obama were to ever approve changing the way U3 is calculated as has been done several times in the past.

All hell would break loose with charges of Muslim-Communist conspiracy.

Surprisingly, I totally agree with you. Clinton jacked it with substitution, hedonics, geometric weighting, played frisbee with it, put it in the microwave on HI, called it "stupid head", etc. And now look at it. If they screw with it again, might as well not even keep track anymore. Redonkulous.

which really even about the unemployment numbers.. it's about continued poor quarterly reports from large companies. Also the big driver.. election uncertainty.

Quote
from TRNT
:

i think making a conclusion based on a one day dow is silly.

For example Fri (today) close is roughly the same as Wed close. So what to make of that?

Looking in the rearview mirror to figure out a story about the future will make you poor in a hurry. Of course the market can react to "news," but there's rarely any news not priced in. You two are arguing each other's points: news doesn't make markets.

the 7.8% was a complete sham arrived at by using new data not previously used for the calculation, called the Household survey, and counting 873,000 new magical PART TIME jobs that just appeared out of nowhere, so now we are comparing apples from the month before to oranges from the following month. The last time the economy added 873,000 jobs the GDP was growing at about 9% or so...we are at 1% or so now, if that....so yes, the numbers are a complete sham...there is no way last month we added 873,000 jobs

Also how convenient it was last month that California missed the deadline to submit their data, thus leaving their numbers out of the calculation, contributing to falsely lowering the rate to 7.8%.

disagree 100%

it is actually 14.7%. Counting underemployed and those who gave up looking, it is actually 22.8%

Ofcourse, we all know it was never below 8%...it was Obama's minions fudging the numbers for the election to make their "lord and savior Barack Obama" (according to jamie foxx) look good for the election...now that the election is over, the numbers automagically return to "normal"

Last edited by Radeck; 12-06-2012 at 01:29 PM..

"None are more hopelessly enslaved than those who falsely believe they are free." - Johann Wolfgang von Goethe

"The federal government has taken too much tax money from the people, too much authority from the States, and too much liberty with the Constitution" - Ronald Reagan

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